Switzerland: #1 in the 2024 World Index of Healthcare Innovation

Introduction

The Swiss healthcare system is ranked first among 32 countries in the 2024 World Index of Healthcare Innovation, achieving a score of 66.19. It maintains its lead ahead of Ireland and Germany, which are ranked second and third respectively, continuing its top position each year from 2020, 2021 and 2022.

Switzerland stands out in all evaluated dimensions of WIHI, ranking 2nd in Quality, Choice, and Science and Technology. The alpine nation owes its success in Quality to its effective disease prevention strategies, patient-centered care, and robust healthcare infrastructure. For Choice, Switzerland offers freedom in selecting healthcare providers and payers within a universally private system. In Science & Technology, Switzerland trails only behind the United States overall, with a top ranking in medical advances and a robust scientific community.

Switzerland also shows how to deliver a quality healthcare system in a fiscally sustainable way, achieving 3rd on the dimension. But despite achieving high marks for efficient public healthcare spending, the growing costs of healthcare and demographic shifts pose the greatest challenge for the country’s healthcare system moving forward.

Background

Switzerland’s health insurance system dates back to the enactment of the federal law on health insurance in 1912, which introduced a voluntary private coverage framework managed at the cantonal level. The adoption rate of health insurance increased steadily: from 11 percent coverage in 1915, to 40 percent in 1930, 60 percent in 1947, and 80 percent by 1959. By the 1990s, health insurance coverage in Switzerland had achieved universality.

In 1994, the Swiss Federal Health Insurance Act significantly overhauled the healthcare system, introducing income-based subsidies to make health insurance more accessible for low-income citizens, mandating individual insurance coverage, and implementing cost containment strategies. Currently, Switzerland operates a universal, market-based health insurance model where all citizens are required to purchase private coverage independently. While the Federal Office of Public Health (FOPH) standardizes the insurance benefits package, cantons have considerable flexibility in structuring their insurance markets, allowing for tailored regional healthcare solutions.

The Swiss system inspired several international health reforms, notably Massachusetts Governor Mitt Romney’s 1996 health reforms and President Obama’s Affordable Care Act in 2010. Similarities are also evident with the U.S. Medicare Advantage program, where seniors choose from various private coverage options. Unlike many other countries, Switzerland does not offer a government-run “public option” for health insurance.

The Swiss Federal Drug Commission advises the FOPH on integrating drugs into the standard insurance benefits package, and the FOPH regulates drug reimbursement rates. Additionally, insurance providers within each canton can negotiate collectively with manufacturers to secure competitive drug prices.

Switzerland also plays a critical role in the global pharmaceutical industry, hosting Roche and Novartis, two of the largest innovative pharmaceutical companies worldwide. Due to favorable tax conditions, numerous other pharmaceutical companies have situated their European headquarters in Switzerland, enhancing its status as a hub for pharmaceutical innovation.

Switzerland’s healthcare system, characterized by high decentralization, allows for significant cantonal autonomy in managing health services, catering to local needs effectively. Despite this regional variation, federal regulations ensure a uniformly high standard of care nationwide. In 2022, healthcare spending in Switzerland accounted for approximately 12 percent of its GDP, one of the highest in the world, reflecting its commitment to comprehensive health coverage and advanced medical care. The country also boasts one of the highest life expectancies globally at 83.4 years, underlining the effectiveness of its healthcare system. The Swiss model continues to balance market-driven dynamics with regulatory oversight, promoting innovation while ensuring quality and equity in healthcare access.

Dimension Performance

Quality

Switzerland achieved 2nd place in Quality, surpassed only by Sweden, within the Index. It sets the standard in infrastructure, boasting one of the highest ratios of nurses per capita and nearly optimal hospital capacities. In disease prevention, Switzerland ranks 6th, standing out as the premier nation in managing treatable forms of mortality. Additionally, the country secures a strong position in patient-centered care, ranking 4th. This is highlighted by its commendable performance in patient safety and efficient consultation durations with primary care physicians.

Choice

Switzerland ranks highly for Choice at 2nd overall, behind only Germany. The Swiss prioritize freedom to choose healthcare services (1st), offering a wide array of health insurance plans and a completely free choice of providers. However, Switzerland spends more on healthcare as a share of economic output than any other major European country. Switzerland has a well-developed pharmaceutical industry, with good access to novel medicines for a country of its size. It does poorly, however, in terms of market share for generic drugs.

Science & Technology

Switzerland holds the 2nd position in WIHI’s Science and Technology rankings, making it the top-ranked country outside the United States. It invests over twice as much per capita in medical research and development as any other nation. In terms of medical advances, Switzerland leads the world, securing the top position. However, it ranks 18th in health digitization, indicating that while hospitals are fully leveraging this technology, primary care and specialist providers have yet to fully adopt it. Swiss scientists are also highly recognized for their research impact, ranking 3rd in scientific citations for their extensively cited academic research.

Fiscal Sustainability

Switzerland has improved its position to third in Fiscal Sustainability compared to last year’s rankings. Although it has the second highest per capita national health expenditures among all countries in the Index, Switzerland allocates just 3.54 percent of its GDP to public healthcare spending, ranking fourth in this category. However, the growth rate of public healthcare spending, ranked 13th, remains a concern, as it does in many countries.